Cost of Poor Quality (COPQ) Intangible Costs

Which is a type of intangible costs?

Among the listed options, lost customer loyalty is an example of an intangible cost.

Answer:

Lost customer loyalty

COPQ (Cost of Poor Quality) can be described as the total cost incurred due to poor-quality products or services. It includes both tangible and intangible costs.

Intangible costs are those that are challenging to quantify or measure directly. One example of an intangible cost is lost customer loyalty. When a company delivers subpar products or services, it can result in customers losing trust and loyalty.

This loss of loyalty can lead to decreased customer retention, lower repeat business, and negative word-of-mouth, all of which can impact the company's reputation and future sales.

While rework, inspection, and warranty are also costs associated with poor quality, they are considered tangible costs as they can be measured more directly in terms of time, resources, or expenses.